I remember the moment I decided to build Orate differently. I'd just calculated what it would cost a user to generate 1,000 minutes of text-to-speech audio using OpenAI's API directly: about $15. Then I looked at what competing platforms were charging for the same usage: $99 per month, sometimes more.
The math was stark. These platforms were marking up API costs by 5-10x while presenting themselves as essential services. Users had no visibility into the actual costs, no control over their spending, and no choice but to pay the premium or go without.
That's when I made a different choice: Bring Your Own Key (BYOK). Let users connect their own OpenAI account, pay the actual API costs directly, and charge only for the platform, storage, and features we add on top. It wasn't just about pricing—it was about what kind of relationship we wanted to have with our users.
The Traditional SaaS Model: Opacity as Strategy
The standard SaaS playbook has long relied on cost opacity. You pay a subscription fee, the service handles everything behind the scenes, and you never see the breakdown of where your money goes. For many products, this makes sense—the value isn't in the underlying infrastructure but in the orchestration, interface, and features built on top.
But something shifted with the AI boom. Suddenly, entire businesses emerged as thin wrappers around powerful APIs from OpenAI, Anthropic, or Google. Research from 2025 shows that most AI SaaS companies use standard markups of 30-50% on API costs, with many going far higher. The actual service provided—managing API keys, adding a nice interface, handling rate limits—became secondary to the markup itself.
Users started noticing. Developer communities began sharing spreadsheets comparing direct API costs to SaaS pricing. The conversation shifted from "Is this worth it?" to "Why am I paying 10x for this?"
The Trust Gap: When users discover the actual costs behind a service, extreme markups feel less like value pricing and more like information asymmetry being exploited for profit.
What BYOK Actually Means
Bring Your Own Key isn't a new concept. Enterprise companies like Salesforce, Slack, and Microsoft Azure have offered BYOK for years—though primarily for security and compliance reasons. Customers wanted control over their encryption keys, the ability to audit data access, and the power to revoke access if needed.
But BYOK means something different in the context of AI and API-driven services. Here, it's not about encryption keys—it's about API keys. It's about letting users connect directly to the underlying service (OpenAI, ElevenLabs, Google Cloud) while your platform adds value through interface, orchestration, and additional features.
In practice, this means:
- Users create their own account with the API provider
- They generate their own API key and enter it into your platform
- The API provider bills them directly for usage
- You charge separately for your platform's features and value-add
The workflow is simple, but the implications are profound. Users can see exactly what they're paying for API usage versus what they're paying for your service. They can monitor their costs in real-time. They understand the value exchange.
The Case for Transparency
When I built URLPixel, my screenshot API service, I could have followed the standard playbook: hide the infrastructure costs, charge per screenshot with healthy margins, and let users assume the entire fee goes to value I'm creating. Instead, I chose radical transparency.
URLPixel uses Browserless for the actual screenshot generation. I don't hide this. I explain in the documentation exactly how the service works, what the costs are, and why I price the way I do. Users pay for storage, bandwidth, and the platform features I add—project organization, webhook systems, bulk processing, quality profiles—not for a marked-up commodity service.
The result? Users trust the service more, not less. They understand what they're paying for. They can make informed decisions about usage. And when they choose to upgrade to paid tiers, they're doing it because they value the features, not because they're locked into an opaque pricing structure.
Transparency Builds Different Relationships: When users understand the economics, they become partners in sustainability rather than extraction targets. They want you to succeed because they benefit from your success.
The Counter-Argument: Why SaaS Companies Resist Transparency
To be fair, there are legitimate reasons why many SaaS companies resist the BYOK model:
1. Support Complexity: When users manage their own API keys, they can misconfigure them, hit rate limits, or run into billing issues with the provider. Support becomes more complicated because problems can exist in multiple places.
2. Business Model Viability: The 30-50% markup on API costs helps fund development, support, and infrastructure. If you only charge for added features, can you sustain the business?
3. User Experience: The traditional SaaS model is simpler. Users don't need to create accounts with multiple services, manage API keys, or understand the underlying infrastructure. They just sign up and go.
4. Revenue Volatility: With BYOK, your revenue from each user is more predictable (subscription for features) but potentially lower. You can't capture the upside when a user has a high-usage month.
These aren't trivial concerns. Building a BYOK product requires more documentation, clearer communication about responsibilities, and often more sophisticated architecture to handle multiple API providers gracefully.
What This Says About the Future of Tech
The tension between traditional SaaS and BYOK models reveals something deeper about where tech is heading. We're at an inflection point where:
1. The Gatekeepers Are Dropping: What used to require teams and significant investment can now be built by solo developers using AI assistance. The technical moat isn't as defensible as it once was. If your entire value proposition is "I made the API easier to use," that's increasingly easy to replicate.
2. Users Are More Sophisticated: Developer communities share cost breakdowns. People understand that "AI-powered" often means "OpenAI API wrapper." The information asymmetry that allowed for extreme markups is disappearing.
3. Transparency Is Becoming Competitive Advantage: 2025 research shows billing transparency is becoming the norm, with customers increasingly demanding clear pricing and cost breakdowns. The companies that adapt to this shift early will build stronger customer relationships.
4. Value Must Be Real: In a BYOK model, you can't hide behind markup. Your value proposition must be clear and tangible. If users can see exactly what you're charging for, you'd better be providing real value for that price.
The Coming Shift: As AI makes building software easier and users become more sophisticated about costs, the old extractive pricing models will increasingly feel like relics of a less transparent era.
Building for a Different Future
When I chose BYOK for Orate and URLPixel, I wasn't just making a pricing decision—I was making a statement about what kind of company I wanted to build. I'm not interested in massive scale or venture capital. I'm interested in sustainable, human-scale businesses built on trust and mutual value.
This means:
- Transparent pricing that users can understand and verify
- Open source options when possible (URLPixel has a self-hosted version)
- Clear communication about what costs what and why
- Features that provide genuine value beyond just API access
It also means accepting trade-offs. My total addressable market is smaller. Users who want the simplest possible experience might choose competitors. My revenue per user is more predictable but potentially lower.
But what I gain is worth it: users who understand what they're paying for, who appreciate the transparency, and who choose to support the service because they value what it provides, not because they're locked in by opacity.
What This Means for Users
If you're evaluating tools, particularly AI-powered services, here are questions worth asking:
1. Can I use my own API key? If not, why not? Is the answer about user experience, or about protecting profit margins?
2. What am I actually paying for? Is it the underlying service, the interface, the features, or all three? Can the company clearly articulate the value they add beyond API access?
3. What are the actual costs? If you can't find this information easily, that might tell you something about the company's philosophy.
4. Is there a path to self-hosting or more control? Companies confident in their value proposition aren't afraid to offer users more control and transparency.
These questions aren't about being antagonistic—they're about being informed. The best companies will welcome these questions because they're proud of their answers.
The Trust Equation
At its core, the choice between traditional SaaS and BYOK isn't really about pricing models. It's about trust.
Traditional SaaS says: "Trust us to handle everything. Don't worry about the details."
BYOK says: "Here's exactly how this works. You can verify everything. We trust you to make informed decisions."
Both can work. But in an era where information is increasingly accessible, where users are more sophisticated, and where AI makes building alternatives easier, the companies that choose transparency may find themselves with something more valuable than locked-in customers: they'll have true partners who choose to stay because they want to, not because they have to.
That's the kind of relationship worth building for. And that's what BYOK represents: not just a pricing model, but a philosophy about how technology companies can relate to their users with honesty, transparency, and mutual respect.
This philosophy informs all my work, from Orate and URLPixel to my upcoming apps. You can explore these projects and see transparency in action at my apps portfolio.